Royal Bank of Scotland: "sell everything"
01-20-2016, 10:25 AM
#91
Gets Weekends Off
Joined APC: Dec 2012
Posts: 299
Originally Posted by deltajuliet
Okay, so how does excess oil lead to lost jobs? It probably affects OPEC's bottom line, but Joe American loves the low price at the pump and the associated cheap airfares he can get. Similarly, airlines generally like cheaper oil prices too. So why do you or I or Joe American lose in this scenario? Why do we lose from excess capacity of other products? I can see those particular industries being affected, but it's their own fault for oversaturating the market and the result of simple supply and demand.
As for bankrupting US oil production, sure, that's bad for our oil industry and then they'll naturally raise prices, but again it's just an inconvenience for Joe American when he goes to fill up his car. People weren't going into freakout mode when gas hit highs in 2007 and early 2008 and putting all their money under the mattress.
Speaking of which, what's so harmful about saving money? It's essentially just deferred spending. If a business fails because people don't want those goods or services in the "tough times," then it doesn't seem like it was a viable business. Sorry. Besides, saving money in the bank still helps the banking industry and by extension the companies that need loans. Crucial industries like food will always be supported, but in a recession the department store selling $70 pre-ripped jeans might close. Again, tough. But that means the market wouldn't support that product; maybe they should have made a better product or an altogether different one. Anyway, suppose David gets laid off from the department store. That sucks for David, and now David doesn't have much money, but Joe who didn't spend money on those overpriced jeans leading to David's job loss has more money. Economically speaking, that seems like a wash. And eventually Joe will spend that money on something he considers worthwhile, supporting the goods and services still relevant in the market.
So, where and how does the cascading avalanche of doom cause millions to lose jobs?
As for bankrupting US oil production, sure, that's bad for our oil industry and then they'll naturally raise prices, but again it's just an inconvenience for Joe American when he goes to fill up his car. People weren't going into freakout mode when gas hit highs in 2007 and early 2008 and putting all their money under the mattress.
Speaking of which, what's so harmful about saving money? It's essentially just deferred spending. If a business fails because people don't want those goods or services in the "tough times," then it doesn't seem like it was a viable business. Sorry. Besides, saving money in the bank still helps the banking industry and by extension the companies that need loans. Crucial industries like food will always be supported, but in a recession the department store selling $70 pre-ripped jeans might close. Again, tough. But that means the market wouldn't support that product; maybe they should have made a better product or an altogether different one. Anyway, suppose David gets laid off from the department store. That sucks for David, and now David doesn't have much money, but Joe who didn't spend money on those overpriced jeans leading to David's job loss has more money. Economically speaking, that seems like a wash. And eventually Joe will spend that money on something he considers worthwhile, supporting the goods and services still relevant in the market.
So, where and how does the cascading avalanche of doom cause millions to lose jobs?
But for a bigger picture lets look at Houston. Dozens of oil companies have already declared bankruptcy and many more have had to make cut backs. This means job loss and less people moving to Houston and more people leaving to find new work. Well, when this happens property values go down which has a direct impact on ones financial situation. Now since those companies went under the loans defaulted and will affect the bottom lines of the banks. Last report I read for Wells Fargo wasn't pretty. This obviously has an affect on the stock prices or oil and financial and most Joe Americans likely have stock in these sectors being affected. Finally low oil is an indicator that the global economy is slowing.
.02 cents
01-20-2016, 10:43 AM
#92
Gets Weekends Off
Joined APC: Jan 2011
Posts: 843
Originally Posted by adspilot
My friend flew for a citation for a small oil company and when oil started going down they had to sell their jet. He lost his job.
But for a bigger picture lets look at Houston. Dozens of oil companies have already declared bankruptcy and many more have had to make cut backs. This means job loss and less people moving to Houston and more people leaving to find new work. Well, when this happens property values go down which has a direct impact on ones financial situation. Now since those companies went under the loans defaulted and will affect the bottom lines of the banks. Last report I read for Wells Fargo wasn't pretty. This obviously has an affect on the stock prices or oil and financial and most Joe Americans likely have stock in these sectors being affected. Finally low oil is an indicator that the global economy is slowing.
.02 cents
But for a bigger picture lets look at Houston. Dozens of oil companies have already declared bankruptcy and many more have had to make cut backs. This means job loss and less people moving to Houston and more people leaving to find new work. Well, when this happens property values go down which has a direct impact on ones financial situation. Now since those companies went under the loans defaulted and will affect the bottom lines of the banks. Last report I read for Wells Fargo wasn't pretty. This obviously has an affect on the stock prices or oil and financial and most Joe Americans likely have stock in these sectors being affected. Finally low oil is an indicator that the global economy is slowing.
.02 cents
01-20-2016, 11:11 AM
#93
On Reserve
Joined APC: Mar 2013
Position: 73N CA
Posts: 20
Seems like every 8-10 years there is a correction/recession of some sort. Whether it is dot.com bubble, real estate bubble, oil/global bubble (or whatever this turns out to be/bubble), the US and world economy will adapt and absorb this. Bad time to retire right now (if you are not diversified). Hopefully just a bear market (or just a correction) vs a worldwide recession. Amazing how so many things work together in this global economy; however, as history has shown (and hopefully repeats itself), this will be a correction/recession and will continue with a general growth trend when you take a long-term outlook.
This happens once every decade. Will probably get a little worse, and then work itself out.
This happens once every decade. Will probably get a little worse, and then work itself out.
01-20-2016, 11:19 AM
#94
Gets Weekends Off
Joined APC: Dec 2012
Posts: 610
Originally Posted by deltajuliet
Okay, so how does excess oil lead to lost jobs? It probably affects OPEC's bottom line, but Joe American loves the low price at the pump and the associated cheap airfares he can get. Similarly, airlines generally like cheaper oil prices too. So why do you or I or Joe American lose in this scenario? Why do we lose from excess capacity of other products? I can see those particular industries being affected, but it's their own fault for oversaturating the market and the result of simple supply and demand.
As for bankrupting US oil production, sure, that's bad for our oil industry and then they'll naturally raise prices, but again it's just an inconvenience for Joe American when he goes to fill up his car. People weren't going into freakout mode when gas hit highs in 2007 and early 2008 and putting all their money under the mattress.
Speaking of which, what's so harmful about saving money? It's essentially just deferred spending. If a business fails because people don't want those goods or services in the "tough times," then it doesn't seem like it was a viable business. Sorry. Besides, saving money in the bank still helps the banking industry and by extension the companies that need loans. Crucial industries like food will always be supported, but in a recession the department store selling $70 pre-ripped jeans might close. Again, tough. But that means the market wouldn't support that product; maybe they should have made a better product or an altogether different one. Anyway, suppose David gets laid off from the department store. That sucks for David, and now David doesn't have much money, but Joe who didn't spend money on those overpriced jeans leading to David's job loss has more money. Economically speaking, that seems like a wash. And eventually Joe will spend that money on something he considers worthwhile, supporting the goods and services still relevant in the market.
So, where and how does the cascading avalanche of doom cause millions to lose jobs?
As for bankrupting US oil production, sure, that's bad for our oil industry and then they'll naturally raise prices, but again it's just an inconvenience for Joe American when he goes to fill up his car. People weren't going into freakout mode when gas hit highs in 2007 and early 2008 and putting all their money under the mattress.
Speaking of which, what's so harmful about saving money? It's essentially just deferred spending. If a business fails because people don't want those goods or services in the "tough times," then it doesn't seem like it was a viable business. Sorry. Besides, saving money in the bank still helps the banking industry and by extension the companies that need loans. Crucial industries like food will always be supported, but in a recession the department store selling $70 pre-ripped jeans might close. Again, tough. But that means the market wouldn't support that product; maybe they should have made a better product or an altogether different one. Anyway, suppose David gets laid off from the department store. That sucks for David, and now David doesn't have much money, but Joe who didn't spend money on those overpriced jeans leading to David's job loss has more money. Economically speaking, that seems like a wash. And eventually Joe will spend that money on something he considers worthwhile, supporting the goods and services still relevant in the market.
So, where and how does the cascading avalanche of doom cause millions to lose jobs?
Big oil has a balance sheet just like every company. If revenue goes down then expenses must also. A short drop in oil doesn't change the accounting but a long haul will change the game. Oil company's spend Billlions on everything from payroll, to vehicles, to real estate, to industrial equipment. They pump billions into the economy even before their greedy profit.
It's very naive to just think they will make less profit and that's where the loses will show.
Specifically to how it affects you is that oil company's are the airlines largest costomers. There the guys paying the $1,200 for a mid week 450 mile trip. Please don't tell me you think grandma in her wheel chair going to see Susie graduate from college is the airlines bread and butter. It may not happen soon, but if big oil adjust their spending you and every other person in the world will know about it. It that large.
Last edited by Waitingformins; 01-20-2016 at 11:30 AM.
01-20-2016, 11:27 AM
#95
Gets Weekends Off
Joined APC: Dec 2012
Posts: 299
Originally Posted by Farmlover
Low oil is amazing for most people. The oil companies have made billions on high oil. It's time they learn to right size just like the airlines did.
America oil companies don't determine the cost of oil.
01-20-2016, 12:01 PM
#96
Banned
Joined APC: Jun 2008
Posts: 8,350
Originally Posted by adspilot
Low oil is good for some people.
America oil companies don't determine the cost of oil.
America oil companies don't determine the cost of oil.
It's another reason Iran wishes to destabilize the House of Saud and Saudi Arabia. They hope to become THE Middle East global player (and power) with an economic base with oil, a religious base with Shiite islam and a nuclear power. If they get there, it will reshape global economics and the balance of power.
01-20-2016, 12:21 PM
#97
New Hire
Joined APC: Jan 2016
Posts: 4
Originally Posted by adspilot
My friend flew for a citation for a small oil company and when oil started going down they had to sell their jet. He lost his job.
But for a bigger picture lets look at Houston. Dozens of oil companies have already declared bankruptcy and many more have had to make cut backs. This means job loss and less people moving to Houston and more people leaving to find new work. Well, when this happens property values go down which has a direct impact on ones financial situation. Now since those companies went under the loans defaulted and will affect the bottom lines of the banks. Last report I read for Wells Fargo wasn't pretty. This obviously has an affect on the stock prices or oil and financial and most Joe Americans likely have stock in these sectors being affected. Finally low oil is an indicator that the global economy is slowing.
.02 cents
But for a bigger picture lets look at Houston. Dozens of oil companies have already declared bankruptcy and many more have had to make cut backs. This means job loss and less people moving to Houston and more people leaving to find new work. Well, when this happens property values go down which has a direct impact on ones financial situation. Now since those companies went under the loans defaulted and will affect the bottom lines of the banks. Last report I read for Wells Fargo wasn't pretty. This obviously has an affect on the stock prices or oil and financial and most Joe Americans likely have stock in these sectors being affected. Finally low oil is an indicator that the global economy is slowing.
.02 cents
01-20-2016, 05:51 PM
#100
Holding
Joined APC: Jan 2012
Posts: 208
Originally Posted by PushRight
I remember when Houston was looking at everyone else during the great recession and laughing while the oil money came in. "We got ours" . Now they get to feel the pain I'm afraid.
Another problem with oil is that the US shale industry was built on cheap high yield (aka "junk") debt. US banks own that debt and it could poison their balance sheets. Unfortunately when the banks have a big balance sheet problem, they usually share it with everybody and tank the markets. They really are pricks about it. So I'm with you, it'd be great to keep this in Texas and N Dakota but there may be some spillover.
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